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The investment arms of three large banks, which face an uncertain future in the US following President Obama’s plans to regulate banks’ involvement in private equity, have backed one of the biggest fundraisings from a company in the country’s cleantech sector.

HSBC will own 10% of the company following the deal, which represents the sixth biggest clean-tech investment on record, according to data provider Thomson Reuters.

Thomson Reuters said Axa Private Equity, the private equity arm of French insurer Axa, carried out the largest investment in alternative energy and similar sectors last year when it invested more than $750m of equity in Italian energy provider Enel Rete Gas.

The Better Place financing will allow the company to expand in Europe and Asia.

As part of the deal, Kevin Adeson, head o global capital financing at HSBC, will join Better Place’s board of directors. The transaction is expected to close in the first quarter of the year.

The deal follows plans revealed by President Obama last week to ban banks from owning, investing in, or sponsoring private equity groups - rules that could have an impact on investment in small and medium sized companies, such as Better Place, and also on the growing involvement of investors in the cleantech sector.

Solomon Wifa, a partner at law firm O'Melveny & Myers, said the plans had sent out a mixed message to the market. He said: “On the one hand, you could also argue on both sides of the Atlantic, governments have been banging on about bank lending and supporting small and medium-sized enterprises and one of the ways of that supporting coming through is by equity investment. In that sense, it is also a mixed message. On one hand, support SMEs but don’t hold private equity investments.”

Funds have sought to benefit from increasing awareness of climate change as governments worldwide have made efforts to clamp down on carbon emissions.

Global private equity investment in cleantech rose steadily for five years until the end of 2008, according to data provider Bloomberg New Energy Finance. In that period, total investment grew from $3.8bn to $32.4bn.

Obama's plans have sparked concern that other countries, including the UK, may adopt similar regulation. Wifa highlighted the Labour Party has said it does not support Obama’s approach but suggested the UK may feel pressure from other countries to implement it.

He said: “I think the statistics show banks make up approximately 10% of funds into private equity so that I not an insignificant amount and so not just for cleantech but other assets in private equity will probably feel the impact of that capital not being deployed into the asset class.”